How to Find Stocks That Pay Dividends

Investing in stocks that pay dividends can be one of the best financial choices you could ever make. Proper planning and thought out investment decisions can allow an investor to build a solid portfolio of dividend paying stocks that can stand the test of time. Those who accumulate these types of securities have a set of investments that can weather any financial meltdown or recession.

There are plenty of tricks that long term investors use to find quality stocks that pay dividends. Some investors think it is an easy process to find these types of investments by looking strictly at yeild. Unfortunately, what is reported as a stocks current yield isn't always reflective of the investment. That is why it is very important to learn how to correctly identify the best dividend paying stocks.

Here are a few tools and resources that can be leveraged by investors to help them find stocks that pay dividends.

Stock searching tools are some of the best resources around and can help investors identify quality stocks that pay dividends. A knowledgeable investor can run stock screens filtering out stocks that have a dividend yield, share price, volume and any other characteristic they are looking for. A good rule of thumb for dividend investors is to look for stocks with a yield between 2% - 5%. Any yield above 5% may be misleading based on other financials of the company.

There are plenty of FREE stock screen tools available on the internet today. Take a look at financial websites that specialize in the stock market. An investor could also look to their online discount broker for tools offered through your account.

Referencing published lists of dividend paying stocks provides another opportunity to find quality investments. The list of Dividend Aristocrats (published by the S&P) is a group of securities that have had a solid history of increasing their dividend payments for at least the past 25 years. In many cases, the stocks found on lists like these are some of the best stocks that pay dividends.

Search around for lists of dividend paying stocks as one place to begin your search. Just remember to follow up with additional research to ensure a particular stock is still a good investment.

There are a ton of internet and online resources that can provide information on stocks that pay dividends. Financial blogs, for example, have risen in popularity and offer a different perspective on investing in the stock market. Other online membership sites have also proven to be a decent resource to find all types of investments, including dividend paying stocks.

It is very important to use these types of resources to generate ideas and expose potential investments. Stock picks and analysis from blogs or other media sources should never be used to solely invest in the market. Every security an investor is considering should be followed up with extensive research to ensure the investment is sound.

Finding stocks that pay dividends does not have to be that complicated as long as the investor does their research. Without educating themselves, an investor may be tempted to chase the highest yielding securities only to realize their high risk after it it too late. Using stock screen tools, referencing published list of dividend paying stocks, and using online media sources are all important tools that can be used to find quality dividend paying stocks.